PwC Pushes Further Into Design, Digital Business – Wall Street Journal


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With a 3,000-plus workforce of creatives and digital business experts, PwC is looking to make waves in the fiercely competitive business of digital design.

PwC on Wednesday is unveiling its “Experience Center” initiative that aims to widen the breadth of the company’s digital services business, the latest example of a consulting firm pushing further into some of the design offerings that digital agencies usually provide.

The “Experience Center” will include the creation of “sandboxes,” which are physical labs for PwC’s growing team of designers to experiment with and prototype digital products and services for clients. The first Experience Center Sandbox will open later this year outside Miami and another facility is scheduled to open early next year in California. PwC is also looking to build another four “sandboxes” in Europe, the Middle East and China.

“It’s a lot of creative designers, industrial designers, experience designers that really complement what we had in PwC consulting more broadly,” said Tom Puthiyamadam, principal for PwC Advisory and digital services leader. “We are combining the MFA, the MBA and the engineer to work together to solve problems.”

PwC’s digital services, whose employees include creative directors, strategists, designers and engineers in 31 cities across the world, help clients build digital apps and websites. The division services 200 to 250 clients globally at any time and about 80% of those clients also use PwC’s broader advisory and consulting services, Mr. Puthiyamadam said.

The company’s digital business has tackled projects such as creating a new digital interface for the salesforce of an agribusiness client and designing a tool to help the administrative team at a hospitality business better communicate directly with its hotel services staff.

PwC has been beefing up its digital expertise in recent years through a series of acquisitions—among them Ant’s Eye View, Intunity and Optimal Experience—and launched its digital services business last year. The division’s annual revenue is roughly $750 million and is projected to grow between 40% and 50% this year, Mr. Puthiyamadam said. By comparison, PwC’s total revenue for the year ending June 30 was $35.4 billion.

PwC isn’t the only consulting firm moving in on some of Madison Avenue’s territory. IBM
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in 2014 said it would spend more than $100 million to build up its marketing consulting business, including the addition of 1,000 new employees and the opening of 10 new experience labs. Accenture has spent $200 million over the past two years to grow its design offerings, including the 2013 acquisition of Fjord and the purchase earlier this year of digital studio Chaotic Moon. Deloitte Consulting’s agency, Deloitte Digital, earned $1.5 billion in revenue last year. KPMG last year acquired digital and mobile technology business Cynergy Systems.

As clients look to navigate an ever-evolving digital landscape, consulting firms are ramping up their marketing and design services as a way to execute on recommendations they provide to clients.

“Digital and digital customer experiences are becoming a critical path to success for most organizations,” said Forrester Research
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’s principal analyst Sarah Sikowitz, who covers agencies. “Consulting companies are helping firms with strategy in this area…[Design] is the next logical step for them as a way to continue to work with clients and drive more revenue.”

Digital agencies within consulting shops “are more likely to be focused on digital customer experience and what it takes to scale and deliver,” often through the delivery of website and mobile experiences, Ms. Sikowitz said. Digital agencies also help develop digital campaign strategies and creative ideas for clients, areas that the consulting firms haven’t made as much headway into yet, she added.

At the same time, digital agencies are also increasing their consulting and strategic offerings, taking consulting firms on head-to-head in their own territory, Ms. Sikowitz added.

Executives at ad holding companies have acknowledged the push of a new crop of players into the marketing business.

“There are consulting companies like Accenture and Deloitte that are getting into the interactive space. There are companies like Salesforce.com and Oracle, Adobe and others that are invading the marketing space. Even the strategic consultancies like McKinsey and BCG and Bain are also invading that area,” WPP Chief Executive Martin Sorrell told investors at a recent Goldman Sachs conference, adding that the company differentiates itself by the talent it attracts.

“I know our competitors — whether it be the tech companies or consulting companies — are trying to have inroads in there,” Interpublic Chief Executive Michael Roth said on the company’s second-quarter earnings call. “We do have that secret sauce, as I put it, in terms of bringing that creative aspect to all of these different tools and resources. We’re the ones who are going to provide that, because this is where the talent wants to be.”

While PwC’s digital services will continue to do a few deals a year to further its global footprint, the division has grown more recently through organic hires.

“It’s a very easy sell to say not only are we going to give you access to great design talent but you’re also going to have…all these other tools at your disposal to deploy as a designer,” said Eric Boisvert, group creative director at PwC.

Mr. Puthiyamadam said the opportunity for PwC’s digital services business to draw upon the rest of the company’s advisory and consulting expertise is a big draw for clients.

“Our ability to take that great new idea and drive a business transformation behind it by using the breadth of PwC — that’s when we get into true innovation. We’re very much rooted in that,” Mr. Puthiyamadam said.

Write to Nathalie Tadena at nathalie.tadena@wsj.com

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